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Employment growth was strong, but private sector remained under pressure as fewer people quit
The number of people quitting their jobs remained near record highs in October as firms faced rising demand and few people left for better pay opportunities elsewhere.
Nearly 1.02 million people terminated their employment – a year-on-year rise of 2.6% and unchanged from September. There were 724,000 new jobseekers, down 42,000 on September.
The number of people leaving their job within a year was 75,000 higher than in September at 936,000 – the highest since the records began in 1995. The month-on-month change was zero in October.
The shortage of people leaving their jobs had been flagged by policymakers at the Bank of England last week, when they acknowledged wage pressures are building and higher inflation is hurting household budgets.
“This is a crucial indicator of the labour market’s strength,” said Michael Saunders, the UK economist at Citigroup. “The rise of 2.6% from September’s robust 2.2% pace (nominal) also suggests that underlying wage pressures remain modest.”
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The Bank of England is expected to start raising interest rates for the first time in a decade before the end of the year, in response to a pick-up in the economy and the economy’s contribution to rising consumer price inflation.
The data shows the labour market continues to run above trend with robust job creation, growth in the wider economy and rising wages, said Philip Shaw, the chief economist at Investec.
“To a large extent we see this as a one-off blip in the growth in the number of UK employees,” he said. “To our mind, this figure seems to have been out of whack with the rise in wages since late 2017 – a key ingredient for a sustained virtuous cycle that feeds into inflation pressure and broader consumer spending, with evidence of this flow being pushed forward.”
Economists said the record-high number of people leaving their jobs likely reflected lack of career opportunities in the private sector.
“We think that it’s likely to continue to signal a lack of positive, positive, current available career prospects in the private sector, which in turn is likely to be putting a dampener on future underemployment levels,” said Stephen Clarke, an economist at Daiwa Capital Markets.